TITLE

STOCK-OPTION-BASED EXECUTIVE COMPENSATION PLANS AND LODGING FIRMS' RISK-TAKING

AUTHOR(S)
Ming-Che Chien; Min-Ming Wen; Yang, Charles C.
PUB. DATE
September 2013
SOURCE
Tourismos;2013, Vol. 8 Issue 3, p1
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This study investigates the impact of stock-option-based (SOB) executive compensation by lodging industry firms on risk-taking, and whether or not perceptions of the risk firms face affects the design of CEOs' compensation contracts. The data analyzed include market-based risk measures and executive compensation for 98 firms over the period from 1992 to 2005 (totaling 734 firm-CEO observations). The study examines research questions by using three-stage least squares in estimating a two-equation simultaneous equation system, in which both firm's risks and compensation structures are endogenous. Risk is measured by total risk and idiosyncratic risk. Results show that contracts with large versus small bonus-option components induce risk-taking and in addition, perceptions of firms' risk do substantially impact the design of compensation contracts.
ACCESSION #
95008463

 

Related Articles

  • DO SEASONED CEOS PREFER FEWER BOARD MEETINGS? EVIDENCE FROM PUBLICLY TRADED FIRMS. Aidong Hu; Richman, Vincent; Santos, Michael // Review of Business Research;2007, Vol. 7 Issue 2, p29 

    We examine how firm characteristics and CEO compensation contract affect the frequency of annual board meetings. As predicted by corporate governance under managerial entrenchment hypothesis, the propensity to hold board meetings is significantly and positively associated with the size of the...

  • The CEO's Agent. Warner, Judy // NACD Directorship;Oct/Nov2007, Vol. 33 Issue 5, p10 

    The article focuses on the role of corporate counsels who advise their CEO clients on their employment contracts, specifically pertaining to compensation. These counsels are hired by CEO, not only to negotiate the terms in the contracts, but also to smoothen relationship with the corporate...

  • CEO Compensation in Canada, 1971-2008. GĂ©linas1, Patrice; Baillargeon, Lisa // International Journal of Business & Management;Jun2013, Vol. 8 Issue 12, p1 

    This paper draws from a unique database spanning over 35 years of Canadian CEOs' compensation to explore the interplay among: the information available to boards of directors of Canadian companies for making executive pay decisions, the Canadian business environment, and the compensation that...

  • Compensation under fire. Berube, Gerard // CA Magazine;Nov2000, Vol. 133 Issue 9, p10 

    Comments on compensation packages for senior executives. Criticisms of institutional investor Warren Buffet against executive compensations; Stock appreciation rights plans (SARP) as alternative compensations for senior executives; Examples of compensation benefits received by senior executives.

  • From The Editor. Narayan, Sanjoy // Business Today;7/1/2007, Vol. 16 Issue 13, p4 

    The author reflects on the high salaries of chief executive officers (CEO) in India. Compensation for executives increases as the country emerges as the fast-growing market for the world's luxury brands. The supply and demand for managers, as well as the rising trend contributed to the rise in...

  • Just what are CEOs Worth?  // New Zealand Management;Jun2003, Vol. 50 Issue 5, Special section p23 

    Presents the results of a Sheffield survey on remuneration of chief executive officers (CEO) in New Zealand as of 2003. Comparison with the fixed compensation package received by Australian CEO; Percentage of base salary/benefits and performance pay in the salary packages of New Zealand CEO;...

  • Nonprofit CEOs in the money. Forster, Polly // Oregon Business Magazine;Sep2005, Vol. 28 Issue 9, p26 

    Reports on the salaries received by nonprofit organization chief executive officers (CEO) in Oregon. Highest paid nonprofit CEO in the state; Sources of revenues for nonprofit operations; Responsibilities of CEOs serving in nonprofit organizations; Comparison between the salaries of nonprofit...

  • INDUSTRY DISCRETION AS A DETERMINANT OF THE MIX AND LEVEL OF EXECUTIVE COMPENSATION: A MULTILEVEL ANALYSIS. CORDEIRO, JAMES J.; RAJAGOPALAN, NANDINI // Academy of Management Proceedings;2003, pO1 

    This article discusses the concept of managerial discretion, a concept viewed as especially promising for explaining the observed variations in inter-industry executive compensation practices. The CEO compensation literature recognizes that incentive compensation schemes may be used to guide...

  • Welcome to 2007: Equity Plan and Executive Compensation Matters for Your Immediate Consideration. Barrall, James; Riley, Maureen A. // Venulex Legal Summaries;2007 Q1, p1 

    The article discusses important topics related to equity plan and executive compensation. Clients are advised to review their current equity grant practices and consider adopting written policies that can be reviewed, audited and updated periodically. The article also calls on companies to...

Share

Read the Article

Courtesy of THE LIBRARY OF VIRGINIA

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics